Congressman Arrested For Insider Trading Immediately Pretends To Not Understand Insider Trading

Chris Collins couldn't have insider traded if no one ever told him the laws that he's tasked with knowing and writing and passing.
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After The STOCK Act It Will Still Be Legal To Trade On Congressional Inside Information*

Here's a sort of touching monologue from David Einhorn's call with Punch: If you’ve done the analysis, and come to the conclusion that on it’s own, the company is not going to make it, it makes all of the sense in the world to raise equity at whatever the price is, so that you can know that the company, you know, is – is going to make it. Now, what that brings to my mind though is, you know, obviously we haven’t done your analysis, we haven’t done -- signed an NDA; I don’t know that we’re going to sign an NDA, because we prefer to just remain investors, but from my perspective, and I’ll be just straight up with you, is that gives a lot of signalling value. And the signalling value that comes from figuring out the company has figured out that it’s not going to make it on it’s own is that we’ve just grossly misassessed the -- you know what’s going on here. And -- and that, that will cause us to have to just reconsider what we’re doing, which is not the end of the world to you. You will continue on even if we don’t continue on with you. You could sort of see why the FSA read that to mean that he was insider trading. Like ... (1) You have told me something with signalling value. Sorry - "a lot of signalling value." (2) I will now act on that signal. (3) Don't be mad. "Signalling value" sure sounds like it means "material nonpublic information," doesn't it? Now as we've discussed before, trading on that information would not be enough to make Einhorn guilty of insider trading in the US, though maybe it wouldn't be exactly a great idea here either. Why? Because in our weird but sort of sensible insider trading laws, it's just not illegal to trade on material nonpublic information. It's only illegal to trade based on material nonpublic information that was obtained in violation of some sort of duty of confidence. Since Einhorn didn't sign an NDA, he had no duty of confidence. And since the Punch CEO and bankers weren't tipping him for nefarious purposes, but were instead sounding him out on the company's behalf as a shareholder and potential investor in a new capital raise, they weren't breaching their duty of confidence. You could quibble with the details of that but it's basically the law here. In England not so much. That also seems to be the law for our friends in Congress, who recently passed a law making it illegal for them to insider trade, which is worrying some people who make their living from trading on Congressional inside information:

Bristol-Meyers Squibb Employee Conducted Numerous Internet Searches Re: How To Not Get Caught Insider Trading Before Engaging In Insider Trading

Which, it turns out, were not very helpful. Mr. Ramnarine, who served as assistant treasurer for capital markets at Bristol-Meyers Squibb from June, 2011, was charged in New Jersey federal court with three counts of securities fraud related to alleged insider trading in the stocks of three companies Bristol-Meyers was targeting for acquisition. According to the complaint, about a week before some of the alleged trading, Mr. Ramnarine opened up Yahoo on his office computer in Princeton, NJ and entered a flurry of searches, including “can option be traced to purchaser,” “can stock option be traced to purchase inside trading,” “insider trading options traceillegal [sic].” Mr. Ramnarine also looked at web sites and articles discussing insider trading laws and ways to avoid insider trading violations, and even downloaded press releases on insider trading from the office of the Securities and Exchange Commission, according to the complaint. Lessons In How Not To Insider Trade [Deal Journal] US v. Robert Ramnarine [Criminal Complaint]